The Role of Donation-Based Crowdfunding Platforms in Improving People's Welfare (Study on the Kitabisa.com)

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ISSN: p-2540-8763 / e-2615-4374 DOI: 10.26618/jed.v%vi%i.10860

Vol: 8 Number 3, August 2023 Page: 373-382

The Role of Donation-Based Crowdfunding Platforms in Improving People's Welfare (Study on the Kitabisa.com)

Maria Anna Muryani ¹⁾, Noor Rosyidah ²⁾,Maliki Alfajr Davin C.S ³⁾,Afif Noor ⁴⁾

1,3) Program Study of Law Science, Sharia and Law Faculty, UIN Walisongo Semarang, Jl. Prof. Dr. Hamka Km 2 Ngaliyan Kota Semarang, 50185

2) Program Study of Islamic Astronomy, Sharia and Law Faculty, UIN Walisongo Semarang, Jl. Prof. Dr. Hamka Km 2 Ngaliyan Kota Semarang, 50185

4) Program Study of Sharia Economic Law, Sharia and Law Faculty, UIN Walisongo Semarang, Jl. Prof. Dr. Hamka Km 2 Ngaliyan Kota Semarang, 50185

Corresponding Author: Afif Noor, Email: [email protected]

History: Received 20/05/2023 | Revised 23/05/2023 | Accepted 25/07/2023 | Published 30/08/2023

Abstract. Indonesia is a welfare state that is responsible for the welfare of its citizens, this is not an easy thing with high levels of poverty and corruption. It takes the participation of all components of the nation to realize this welfare. The object of this study is to determine the role of donation-based crowdfunding (DCF) platforms in improving people's welfare by focusing on the Kitabisa.com platform. In this study, the problem formulation is the extent to which DCFs such as Kitabisa.com can contribute to improving community welfare. The research method used is qualitative by collecting data through printed and online documents. The results showed that DCF platforms, particularly Kitabisa.com, have helped individuals resolve financial burdens and made it easier for the community to access donations. DCF has a significant role in facilitating financial assistance for individuals and communities in need and is very effective in connecting donors and recipients, providing an easy-to-use interface, and ensuring transparency in the donation process that can have implications for improving people's welfare.

Keywords: Donation-Based Crowdfunding; People’s Welfare; Kitabisa.com.

INTRODUCTION

Indonesia is a welfare state. This statement is contained in the fourth paragraph of the Preamble of the 1945 Constitution of the Republic of Indonesia, which states that the state is obliged to organize public welfare as reflected in the statement "The state has the responsibility to promote public welfare"

(Abqa et al., 2023; Zulkarnaen, 2018).

Consequently, the state must endeavor to provide welfare to all its citizens without exception. The state is the party most responsible for the welfare of its citizens.

To realize welfare that can be felt by every citizen is not something easy. Several problems hinder the government as the holder

of the state mandate to realize this welfare, including the relatively high poverty rate. The number of poor and vulnerable people is almost one-third of Indonesia's population.

(Septiadi & Nursan, 2020). The quality of education of the Indonesian people is also still relatively low (Utami, 2019), this condition has an impact on high unemployment in Indonesia (Padang & Murtala, 2020; Sitadewi, 2017). This condition is exacerbated by the high level of corruption in Indonesia (Alifah, 2023; Fitrah & Dapang, 2023). These facts are an obstacle to the realization of the welfare of the Indonesian people.

For this reason, the participation of the community and all components of the nation is

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Vol: 8 Number 3, August 2023 Page: 373-382 needed to participate in assisting the

government's duties to realize welfare for all Indonesian people because it can have a positive impact, namely efficiency in the implementation of welfare (Putra & Erlangga, 2022). The participation of the community can be carried out in various forms of philanthropy activities such as corporate social responsibility (Suwandi et al., 2021), religious-based philanthropy such as shadaqah, and raising funds from the community and private companies in Indonesia by crowdfunding (Rochani et al., 2021).

Fundraising through crowdfunding has been carried out by many religious and non- religious institutions such as non- governmental organizations and foundations.

Lembaga Amil Zakat (Lazis) Wahdah, for example, is one of the religious institutions that raise funds by crowdfunding (Saifullah, 2017). Crowdfunding fundraising conducted by non-governmental organizations, among others, is carried out by the Coral Triangle Centre which raises funds for the benefit of environmental protection (Al-haq et al., 2015).

In addition to these two institutions, foundations are the institutions that do the most crowdfunding. Some crowdfunding institutions in the form of foundations include ACT Foundation, Yatim Mandiri Foundation (tanamberkah.com), IKAMaT Foundation (ikamat.org), Ayo Bantu Peduli Indonesia Foundation (ayobantu.com), Benih Baik

Foundation (benihbaik.com) and Kita Bisa Foundation (Kitabisa.com).

A large number of donation crowdfunding organizers is interesting to study, especially related to its contribution to improving people's welfare as the goal of the state as stated in the Preamble of the 1945 Constitution. Many studies on the existence of donation crowdfunding have been conducted both on an international and national scale (Golrang & Safari, 2021; Kemenkes RI, 2020;

Kenang & Gosal, 2021; Ramadhan &

Hendratmi, 2023; Salido-Andres et al., 2021;

Sirisawat et al., 2022; Tri Kurniawati et al., 2021; Wagiman and Muhammad Luthfi Reza Izzulhaq, 2022; Yang & Li, 2022; Zhang et al., 2020). There has also been researching that examines the existence of the Kita Bisa Foundation with its platform Kitabisa.com (Amalia et al., 2020; Ariyanti et al., 2020;

Firdaus & Tutupoho, 2022; Fitriana et al., 2021; Pranata et al., 2022; Salsabila & Hasbi, 2021; Sespiani et al., 2021; Sidiq et al., 2021;

Sitanggang, 2018; Warapsari, 2020).

However, these studies have not revealed the role of donation crowdfunding in improving community welfare or specifically examined the role of Kitabisa.com in contributing to community welfare through fundraising activities carried out through a platform specifically provided for this purpose. The selection of the Kitabisa.com platform is based on the reason that it is the

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Vol: 8 Number 3, August 2023 Page: 373-382 largest platform in Indonesia (Herna et al.,

2019).

An assessment of the role of the donation crowdfunding platform in contributing to people's welfare is expected to show that fundraising through information technology platforms is more effective, and efficient and encourages young millennials to be closer to information technology facilities and willing to make donations that can be used as social reserve funds outside of government funds. Community participation in making donations is a manifestation of the attitude of cooperation which is characteristic of the Indonesian nation and has a rigorous philosophical and juridical basis in Pancasila and the Preamble of the 1945 State Constitution.

RESEARCH METHODS

Based on the focus of this research, this research is qualitative research using a case study approach using descriptive methods. The subject of this research is the Kitabisa.com platform whose instrument is the researcher himself. Data collection was carried out with document studies sourced from secondary data in the form of documents (Noor, 2023).

Therefore, this research is also called library research. The data obtained is analyzed descriptively and qualitatively, and then conclusions are drawn according to the focus of the research.

DISCUSSION

Definition and Benefits of Fundraising Through Donation-based Crowdfunding

Theoretically, crowdfunding is the practice of soliciting funds for an enterprise or project from a large group of people spread across multiple locations collectively referred to as the "crowd" (Asad Noor et al., 2022). An open call is organized predominantly online to gather financial resources, either through donations without expecting compensation or through the exchange of remuneration and/or voting rights, aiming to support initiatives that have specific objectives (Khan et al., 2017).

There are at least four distinct categories of crowdfunding, which include reward-based crowdfunding that offers goods, services, or rights to contributors, debt-based crowdfunding that involves loans that must be repaid with or without interest, equity-based crowdfunding that grants funders securities and ownership in the company with potential dividends, and donation-based crowdfunding (DCF) where funders provide donations without expecting any monetary return (A Noor et al., 2021; Afif Noor et al., 2022).

Zhao and Shneor explain that DCF is fundraising via the Internet where supporters provide funds based on philanthropic motivations without expecting monetary or material rewards (Zhao & Shneor, 2020).

Based on the definition and categorization of crowdfunding above, can be concluded that DCF is fundraising from a large group of

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Vol: 8 Number 3, August 2023 Page: 373-382 people to finance certain projects carried out

through the Internet or platform with philanthropic purposes without expecting rewards.

DCF platforms provide opportunities for fundraisers to campaign openly through the Internet to donate to charitable causes within a fixed period. The use of information technology in raising donations for charitable purposes is more efficient, can reduce costs, makes it easier for fundraisers to broadcast their campaigns to many potential donors, and allows for more in-depth interaction between donors and fundraisers during the project.

DCF or online fundraising has several benefits. First, it provides opportunities for fundraisers to reach a wider geographical area both locally and internationally and reach more donors (Agrawal et al., 2015; Gleasure &

Feller, 2016). Second, the efficiency of transaction costs in fundraising because it uses a digital payment system or similar based on sophisticated information technology (Choy &

Schlagwein, 2016).

The ease and efficiency of fundraising using this crowdfunding model have encouraged public interest in making donations. Based on a survey conducted by Telkomsel through tsurvey.id between 18-20 March 2022 involving 952 respondents with the proportion of respondents consisting of 63% men and 37% women, it was found that 69% of respondents often donate online, with the number of donations exceeding 2.5%. Of

the total respondents who participated in this survey, around 48% of them donated online with an amount between 2.5% and 5% of their income. Meanwhile, 14% of respondents donated between 5% and 10% of their income, and another 7% donated more than 10% of their income. The majority of respondents who donate online do so more than once a month (59%), and the frequency of online donations is higher than offline donations (50%). The majority of respondents donate online because they have cashless payment options (31%), ease of finding information about donations (23%), and the existence of trusted online donation management institutions (19%) (Annur, 2023).

The data above shows the high interest of Indonesian people in donating using the DCF platform. The ease and convenience of donating through the DCF platform allow people to contribute more to fundraising projects because they only need to click on the DCF platform to donate (Chen et al., 2021;

Huang et al., 2021). Besides the ease and convenience, the high demand for people to donate using the DCF platform is also driven by the accessibility to digital devices (Banerjee, 2021; Kartika et al., 2022). The use of smartphones or computers connected to the internet allows donors who live in urban and rural areas to donate without having to physically come to the institution that raises funds.

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Vol: 8 Number 3, August 2023 Page: 373-382 The Role of Kitabisa.com in Improving

People's Welfare

Kitabisa.com is one of the platforms that organize donation-based crowdfunding services in Indonesia, which was founded by Yayasan Kita Bisa in 2013. Yayasan Kita Bisa itself only obtained status as a legal entity from the Ministry of Law and Human Rights in 2014 with No. AHU 03272.50.10.2014. Along with the issuance of Government Regulation No. 71 of 2019 concerning the Implementation of Electronic Systems and Transactions which requires electronic system service providers (PSE) to register, the Kita Bisa Foundation formed a limited liability company called PT Kita Bisa Indonesia.

In 2019, Yayasan Kita Bisa with its platform Kitabisa.com has a license as an institution that collects money and goods (PUB) from the Ministry of Social Affairs with Decree No. 126/HUK-UND/2019 for the general category. The permit must be renewed every three months. The permit from the Ministry of Social Affairs was followed by approval as a PSE organizer from the Ministry of Communication and Information on 25 February 2021. Kitabisa.com has obtained status as a PSE in the information and communication technology sector that functions as an intermediary media for the creation of online social donation pages both through websites and applications on mobile phones. This legality strengthens the Kitabisa.com platform to be able to facilitate

parties who need to raise funds according to their needs.

Since its establishment in 2013, Kitabisa.com has facilitated fundraisers for various activities, such as personal challenge or birthday fundraising, fundraising for others, and fundraising for religious social activities, such as building houses of worship, building schools, and natural disaster relief. DCF on Kitabisa.com is done through various social media such as Instagram, Twitter, Facebook, and the website.

The use of various social media has made Kitabisa.com a DCF organizer that has succeeded in raising funds from donations and wallet replenishment totaling IDR 840,067,886,708 in 2020. In 2021, the revenue increased to IDR 1,075,057,664,675. The funds were raised by more than 100,000 fundraisers and given by more than 6 million donors. Each fundraiser has a varied time ranging from 30, 60, and 90 days or a certain period to raise funds through the Kitabisa.com platform (KitaBisa, 2021). The donations that have been collected are used following the fundraising objectives, which are broadly divided into two types, namely raising donations for medical-related purposes and raising non-medical donations.

Medical-related fundraising is used, among others, to improve the nutrition of toddlers and the medical expenses of patients.

The medical-related donations that are still ongoing in May 2023 can be seen at the

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Vol: 8 Number 3, August 2023 Page: 373-382 following links; https://kitabisa.com/explore/

bantuan-medis and https://kitabisa.com/

explore/balita-anak-sakit. On these links, various forms of medical assistance are urgently needed by the community both carried out by individuals and social institutions. Kitabisa.com plays a major role in facilitating people who need financial assistance for medical-related activities.

While non-medical fundraising includes donations for humanity, repairing houses of worship, social activities, zakat, education assistance, public infrastructure improvements, assistance to orphanages and disabled people, maintaining environmental ecosystems, creative works, and business capital. Non-medical donations that are still ongoing in May 2023 can be seen on the link;

https://kitabisa.com/pilihan-kitabisa and the link https://kitabisa.com/ explore/bencana- alam. These links can show the role of Kitabisa.com in facilitating people who need funds to improve education, health, and environment, repair worship facilities and improve infrastructure that supports people's lives.

Based on the facilitation carried out by Kitabisa.com by providing a DCF platform for people who need funds for medical and non- medical matters such as matters relating to education and business dissemination as indicated by the links on the website or Uniform Resource Locators (URL) above, it appears that Kitabisa.com participates in

realizing people's welfare. This is based on the theory that to describe the welfare of the people, among others, is determined by improvements in the level of health, education, and economic improvement of the community (Kustiandi & Rachmawati, 2020; Wahyuni &

Wulandari, 2022).

Based on the use of funds raised through the Kitabisa.com platform as mentioned above, the DCF platform has a major role in the fields of education, health, and economy, which leads to the improvement of community welfare by providing financial assistance, fostering community support, facilitating access to various opportunities, and empowering individuals. With the facilitation provided by the DCF platform, there will be access to funds for education, health, and entrepreneurial endeavors and the improvement of people's social lives. As such, the DCF platform can empower individuals and communities, creating avenues for social growth, development, and progress toward socially just prosperity for all Indonesians.

CONCLUSION

Studies on the Kitabisa.com platform show that donation-based crowdfunding plays a significant role in improving community welfare. Donation-based crowdfunding platforms become an effective tool to mobilize financial support and resources from various donors, which ultimately leads to improved individual welfare. Through the power of

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Vol: 8 Number 3, August 2023 Page: 373-382 collective giving, donation-based

crowdfunding platforms such as Kitabisa.com have the potential to create a positive social impact, address pressing social issues, and empower those in need. As such, it appears that donation-based crowdfunding platforms offer a promising avenue for individuals, organizations, and communities to come together, make a difference, and contribute to improving the well-being of the entire society.

ACKNOWLEDGMENTS

This research received funding from the Operational Assistance of State Universities of the Ministry of Religious Affairs of the Republic of Indonesia in 2023. For this reason, thanks are expressed to the Institute for Research and Community Service at Walisongo State Islamic University Semarang for the funding assistance provided.

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